The implicit carbon price of renewable energy incentives in Germany
Open accessAbstract
This research analyzes the German experience in promoting Renewable Energy (RE) as an instrument to reduce GHG emissions. It identifies the cost of reducing CO2 emissions in the power sector through the promotion of wind and solar energy for the years 2006-2010. A RE carbon surcharge and an implicit carbon price due to the RE incentives are calculated. The RE carbon surcharge is the ratio of the net cost of the RE over the CO2 emission reductions resulting from actual RE injections into the electric power system. The implicit carbon price is the sum of the RE carbon surcharge and the EUA price. Results show that for the period analyzed both the RE carbon surcharge and the implicit carbon price of wind are on the order of tens of euro per tonne of CO2, while for solar are on the order of hundreds of euro per tonne of CO2.
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For PV generation in Germany over 2006-2010, the implicit carbon price averaged €552/tCO2.
“For PV generation, the implicit carbon price is much higher, averaging e 552/tCO2 over the same period.”
From The EU ETS and its companion policies: any insight for China's ETS? (2021) · cites this paper as Marcantonini and Ellerman (2016)
For support to wind generation in Germany over 2006-2010, the implicit carbon price averaged €57/tCO2.
“For support to wind generation, the implicit carbon price is found to average e 57/tCO2 over 2006-2010.”
From The EU ETS and its companion policies: any insight for China's ETS? (2021) · cites this paper as Marcantonini and Ellerman (2016)
The abatement costs of companion policies were much higher than concurrent carbon prices.
“The empirical evidence summarised in section 4, which mainly covers the first two trading periods of the EU ETS, clearly shows that: (a) emissions in the electricity sector were primarily abated by companion policies, rather than by carbon prices, and (b) that their abatement costs were much higher than concurrent carbon prices.”
From The EU ETS and its companion policies: any insight for China's ETS? (2021) · cites this paper as Marcantonini and Ellerman (2016)
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- Authors
- Marcantonini, C., & Ellerman, A. D.
- Affiliations
- European University Institute (IT)
- Venue
- The Energy Journal
- Publisher
- SAGE Publications
- Published
- 2015-10
- Volume
- 36
- Issue
- 4
- Pages
- 205-240
- ISSN
- 0195-6574 (ISSN-L)
- 1944-9089
- OpenAlex
- W2164279987
- Cited by
- 49
- References
- 25
- Citations by year
- 2026: 1 · 2025: 3 · 2024: 3 · 2023: 2 · 2022: 8 · 2021: 9 · 2020: 5 · 2019: 4 · 2018: 5 · 2017: 5 · 2016: 4
- FWCI
- 11.27
- Type
- journal article
- Language
- en
- Open access
- green
- hdl.handle.net
- Licence
- Locations
- The Energy Journal (publishedVersion)
- Cadmus - EUI Research Repository (European University Institute) (submittedVersion, public-domain)
- RePEc: Research Papers in Economics (submittedVersion)
- Topics
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Climate Change Policy and Economics
- Physical Sciences › Energy › Renewable Energy, Sustainability and the Environment › Renewable Energy and Sustainability
- Physical Sciences › Energy › Renewable Energy, Sustainability and the Environment › Renewable energy and sustainable power systems
- Keywords
- renewable energy incentives, CO2 emission reduction, wind energy, solar energy, EU Emissions Trading System, power sector emissions, Germany, renewable energy policy
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